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Mar 24th, 2010: Watching 1177 Resistance

Posted by pugsma on March 24, 2010

10:15pm EST:  Another possibily is that wave 3-[5] ended at 1170 last Wed (3/17), and the SP-500 has been in a large A-B-C-D-E triangle for wave 4-[5]. Each leg of the triangle must be a 3-wave move and so far these waves since the 1170 peak do look like 3-wave moves. Looking at the orange labels on the 15-min chart, we have the A-leg down to 1153, B-leg up to 1175, and now the C-leg down to about 1156 area. The 13-day EMA is currently at 1155, so that area could stop the next decline. And as I have said multiple times, wave 4-[5] should alternate in form with wave 2-[5], which was a clear cut A-B-C Zig-Zig. The triangle wave 4-[5] would do just the trick. The triangle E leg should end around 1160 some time on Tues (3/30) or Wed (3/31). This will allow the SP-500 to move side-ways over to the yellow channel before begin wave 5-[5] up towards 1230.

15-min Chart with Triangle Wave 4-[5] (10:15pm):

6:35pm EST:   The close slightly below the 1168 pivot is bearish heading into tomorrow.   I’ll be watching for a cross below the lower purple channel near 1164 area early tomorrow to confirm that 1174.72 is the top of wave 3-[5].  However,  a postive move up in the morning cound signal wave 3-[5] is not finished just yet.   The wave (5)=(1) target of 1189 is still up there.

I’m looking for wave 4-[5] reach the 1154 (23%) or 1141 (38%) retrace area.

15-min Chart (EOD):

60-min Chart (EOD):

12:15pm EST:  Looking at the SP-500 Daily Candle Stick chart with RSI, MACD and PPO, there are some divergences that are starting to show up.  And it looks similar to the mid-August 2009 area of the chart after the strong bounce off 869.   So, we should expect a pull-back in wave 4-[5] toward the 34-day EMA (currently at 1134) that will be in the 1140 to 1150 area next week.

SP-500 Daily Candle Chart (12:15pm):

11:00am EST:   Yesterday the SP-500 broke through the key 1168 pivot resistance from Oct 2005.  Today we need be watching close the 1177 pivot resistance point from 2002.  I’ve been saying for a while now that I thought his wave up off the 1086 low would die in this 1168 to 1177 resistance band.  And this 1168 to 1177 area also cooresponds to the measured move predicted by the inverse head and shoulders off the 1045 low.  I’m looking for wave 4-[5] to begin from inside this resistance band.  And I believe 4-[5] will be a triangle wave to alternate with the wave 2-[5] single zig-zag.  I expect the 4-[5] triangle to play out in the 1141 to 1177 area over the next week or two.  This triangle should provide the consolidation needed to push towards the 1230 level in a wave 5-[5] to follow into mid to late April.

SP-500 15-min  Chart (10:30am):

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